Iridium gets $20 million funding from investors

BANGALORE: Iridium LLC has announced that it has obtained a funding commitment of $20 million from current investors led by Motorola. The funding will be used for ongoing operations while the company plans to achieve its financial restructuring. Motorola is seeking broader participation in the $20 million funding commitment from other current investors. Iridium LLC will request approval of these arrangements in a motion to be filed on December 10, 1999 with the US bankruptcy court for the southern district of New York. The company will seek an extension of its current cash collateral order, which expires on December 15, 1999 through February 15, 2000 to accommodate these arrangements.

According to a company press release, discussions with parties have been held since Iridium filed on August 13, 1999 for relief under Chapter 11 and no investment offers have been made. The company also claims that, throughout the restructuring process, new customers have been added to the Iridium global service network and over 50,000 customers have purchased Iridium phones. Company vice president for sales and distribution Sue Kennedy said, "The loyalty of our customers despite the financial challenges we face and the interest Iridium continues to attract from new customers is encouraging. Customers can be confident that sales, including those related to Y2K, will be supported with Iridium's best efforts to provide a contingency communications alternative."

As part of a service to its customers, the company has announced that Motorola expects to commence shipments by year-end of its smaller Satellite Series 9505 portable phones that are smaller and lighter than the initial generation of Motorola satellite Series phones.